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Since Google
Analytics was made available for free in 2005, marketers,
media experts and everyone in between has struggled to make sense
of the various metrics it records--page views, visitors, uniques.
Meanwhile, many business owners have ignored this data entirely,
focusing only on the number of sales or leads a site generates.
After all, if a website
doesn't generate revenue or collect prospects' contact
information, then something must be wrong.

According to Jakob Nielsen, co-founder and principal of Nielsen Norman Group, a Fremont, Calif.,
firm that conducts evidence-based online user research,
neither the marketers nor the business owners are entirely
right. The one data point that matters most is conversion
rate. This counts what percentage of visitors responded to
calls to action on your site, such as clicking on an article,
scheduling an appointment or buying a product. The rate
provides an accurate measure of your website's effectiveness
at engaging visitors, no matter whether you see 1,000 or 1
million visitors each month.

To figure out your conversion
rate, divide the number of people who undertake a specific
action on your site by the total number of visitors. It's that
simple.

The tricky part is figuring out how to boost that percentage.
Nielsen points to three classic website
metrics that, taken together, play a critical role in your
website's conversion rate. Improve these numbers, and you should
end up with a more successful website--and business.

Search engine
ranking. Unless your site appears on the first
results page of a search related to your industry, you may as
well not exist online at all. That's because only 2 percent of
online customers bother to look at the second page of results.
Months of SEO work, near-daily content updates and a streamlined
back-end design will help you reach page one.

User loyalty. This is a measure of your site's
repeat visitors (defined by Google Analytics as visitors, as
opposed to uniques). The fewer uniques you see as a percentage of
your total visitation, the more loyal your audience. Why should
you care? Because it's always easier to sell to a loyal customer
again than it is to sell to someone who doesn't know you for the
first time.

Bounce rates and visit duration. These are
actually two metrics, but they're related. Bounce rate is the
percentage of users who leave immediately after seeing one page.
(Presumably, they think your site is terrible.) Visit duration is
the number of pages scanned per visit, or the amount of time
spent on the site. A low bounce rate and high visit duration
tells you that people find your website useful and valuable.

Nielsen cautions that even by addressing all these metrics, the
decisive factor in your conversion rate is ultimately the product
or service your business offers. Put simply, if you have
something everybody wants, your conversion rate will be sky-high,
even if your website sucks.